WM is underperforming the S&P 500 in 2025.
The company’s core business is performing well, but results in recycling and healthcare have been disappointing.
WM is forecasting gobs of free cash flow in 2025 and 2026, which supports future dividend raises.
10 stocks we like better than WM ›
It’s easy to give up on dividends when the major indexes are roaring to all-time highs. After all, what good are a few percentage points of yield when the S&P 500 (SNPINDEX: ^GSPC) is up 17% year to date?
WM (NYSE: WM), formerly Waste Management, sold off after reporting third-quarter 2025 earnings. The stock has gone practically nowhere over the past year despite the broader market rally.
Here’s why WM is a great buy for risk-averse investors looking to boost their passive income.
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For the third quarter, WM reported $1.98 in adjusted diluted earnings per share, missing analyst consensus estimates for $2.01. That’s just 1% growth compared to the same quarter in 2024. WM’s core collection and disposal business generated record results in the latest quarter. But neither its healthcare solutions nor its recycling processing and sales segments delivered.
WM operates an integrated waste collection, transportation, and disposal business for residential, commercial, and industrial customers. It also has a growing recycling and renewable energy business, driven by converting landfill gas into reusable pipeline-quality gas. WM has also been growing its healthcare solutions business, which provides environmental services for the healthcare industry.
Healthcare solutions revenue came in below expectations, as WM said it was deferring some planned price increases to prioritize customer lifetime value.
Revenue declined by $60 million in the recycling processing and sales segment due to lower market prices for recycled commodities, including a 35% drop in the blended average price of single-stream commodities. Single-stream recycling incorporates different materials, like glass, cardboard, and paper into one bin rather…
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